Opinion: Strengthened safety nets will reduce poverty

The new B.C. government’s budget 2017 update includes measures that make life more affordable for those who depend on temporary and disability income assistance, the province’s social safety nets.

This October, temporary income and disability income rates increase by $100 per month. The maximum temporary assistance will now be $710, and for disability assistance $1,133 per month. These rate increases provide an immediate benefit to about 190,000 British Columbians.

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The $100 monthly enhancement to disability assistance is additional to a $50-per-month increase the previous government announced, which took effect in April 2017. This means that over the past six months, the maximum amount for disability assistance in the province has gone from $983 to $1,033 to $1,133 per month.

Another priority of the new government for disabled people is the full restoration of the B.C. Bus Pass Program. The speech from the throne declared that as of January 2018, the government “will provide people with disabilities access to the transportation supports they need, including an annual bus pass, for those who want one.”

While the government is finalizing details on this pledge, Shane Simpson, the minister of social development and poverty reduction, has said there will be no monthly fee for the bus program. In effect, this will provide a further $52 per month to people receiving disability assistance. With this transportation support, the maximum disability benefit for a single person in 2018 equates to an annual income of $14,220 for people living with significant disabilities.

With these measures, B.C. is on the road to eliminating the gap between disability income assistance and the actual cost of living in the province. That road will mean several steps that are more meaningful.

The increase to temporary assistance, the first in a decade, results in an annual income of $8,520. This initial step by the new government is important. Of course, the new amount remains well short of an amount adequate for having a decent and dignified life in B.C.

For those on income assistance, the budget update increases the earnings exemptions by $200 per month, to take effect in October. The update says: “Earnings exemptions allow people on social assistance to work, earn money, build job skills and experience, and better support themselves and their families.”

At present, most people on temporary income assistance are allowed an earnings exemption of $400 per month, while a single person on disability assistance can earn on an annualized basis $9,600 (or effectively $800 per month). Over these limits, any earned income is deducted dollar for dollar from monthly benefit payments, a marginal tax rate of 100 percent.

A family on temporary assistance will now be able to earn a maximum of $600 per month without having their monthly income assistance clawed back. A person on disability assistance will now be able to earn up to $12,000 a year on top of their monthly benefit.

How many people possibly will benefit from this increase to earnings exemptions? Only a small share.

The Ministry of Social Development and Poverty Reduction estimates that just nine per cent of the temporary assistance caseload (or 5,800 clients) and only three per cent of those on disability assistance (or 3,000 clients) make use of the earnings exemptions. We need to understand better why the take-up of earnings exemptions is so low among income-assistance recipients, in order to tackle the barriers and support the enablers of effective transition to gainful employment.

The budget update also allocates about $1.5 million for the remainder of the 2017/18 fiscal year to “support the initial planning work needed to develop a comprehensive poverty reduction plan, including a basic income pilot.”

This funding should support work on community engagement and social policy dialogue on ways to improve services and outcomes for low-income families in B.C.

A comprehensive poverty-reduction plan will need to encompass co-ordinated and concerted efforts by the province. Innovations and new investments are needed in child care and early learning, housing and homelessness, training and employment, community services, mental-health care, tax credits and income assistance.

Michael J. Prince is the Lansdowne Professor of Social Policy at the University of Victoria.

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